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>> chris: i'm chris wallace. it's crunch time in the debt ceiling talks. and neither side is backing down. ♪ with president obama and congressional republicans deadlocked, we'll gate read on where things stand from two key house members. jim jordan, chairman of the house republican study committee. and chris van hollen, the top democrat on the budget committee. it's a fair and balanced debate. only on "fox news sunday." then, the g.o.p. presidential race. we'll sit down with candidate herman cain as we continue our series "2012: one on one." for all the talk of possible default on august 2, the real focus may be election day 2012. we'll ask our sunday group
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which party is gaining the upper hand with voters next year. all right now on "fox news sunday." and hello again from fox news in washington. well, with just 16 days to go until our country reaches the debt limit, with threats from ratings agencies to downgrade the nation's credit, what deal is still possible? here to discuss the options are two key house leaders. jim jordan is chairman of the house republican study committee. chris van hollen is the top democrat on the budget committee. congressmen, welcome back to "fox news sunday." >> good to be with you. >> chris: this week the house will vote on something called "cut, cap and balance." let's outline what it would do. you would cut the deficit $111 billion next year. you would cap spending under 20% of g.d.p. in a decade. it's now 24%. you would raise the debt ceiling only after congress passes a balanceed budget amendment.
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congressman jordan, you are a big sponsor of this. president obama says it would cut medicare and social security much more deeply than paul ryan's budget plan. >> it mirrors the budget proposal that house passed earlier this year. we like to do it as a common sense american plan. americans know we're spend toog much, we're headed for a cliff, we're headed for bankruptcy. let's cut spending in year one, cap it as a percentage of our economy going forward. everyone understands our government is getting too big. do something historic. for the first time in american history, pass a balanced budget amendment through the house and the senate, send it to the states. have this requirement that everyone else has to live under, make the federal government either has a $14 trillion debt, let's make up with the same requirement everyone else has to abide by. >> chris: since sensible. congressman van hollen, what is wrong with cut, cap and balance and what are the chances it will get through the house, senate and signed by the president? >> no one should be fooled about this. they're not proposing a clean balanced budget amendment. what they are proposing is to
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manipulate the constitution and use it to impose the republican budget plan. if you look at that plan, it does end the medicare guarantee. it slashes medicaid. it slashes deeply to education. it protects tax breaks for special interest. thaw would write it in the constitution. under their proposal it would be easier to cut medicare than to cut subsidiaries for oil and gas company. you have majority vote to cut medicare and majority vote to create special interest loopholes. you need two-third to close tax breaks. that is an anti-majoritarian position. framers would be turning in their grave if they read the provision. >> chris: what are the chances it will become law? >> it's not going to become law, that's why it's so dangerous for the republican congress to say if you don't do this, the united states will default on its debt. >> chris: congressman jordan, i want to give you a chance to respond. but also, there are 16 days left until we hit the august 2
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deadline. even if cut cap and balances is as good as you say it is, should we spend precious time from outside observers say is not going to become law? >> of course we should. this is something that fixes the problem. everyone understands in two or three years we will have a debt crisis. we have to do big, bold things, that's where we are headed. to call balancing the budget dangerous is unbelievable. this is what we have to do. >> this is your version of that. >> this is what we have to do. mr. president, put a plan on table. democrats, paut plan on the table. if the president can put details to a plan let's have a national debate and let american people decide do they want something that is common sense, cutting spending, cap growth in government and require balanced budget amendment to the constitution. do they want the common sense thing versus the president's plan? let's have a national debate. >> let me be clear. i didn't say it's dangerous to balance the budget. we want to balance the budget. but if passed it's not
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balanced until 2040. this would require you to lift the debt ceiling by $8 trillion between now and 2021. >> chris: gentlemen, we have a lot to cover. move to the next thing. we'll get back to a bunch of these issues. if cut, cap and balance fails, and i must say must people say whether it's good policy or not, congressman jordan, the chance it is actually going to pass in the next two weeks are pretty slim. the most likely fall-back is some version of mitch mcconnell fallback plan. take a look at that. it would allow the president to raise the debt limit $2.5 trillion without any spending cuts but there is talk about him putting $1 trillion in cut and setting up another debt commission. congressman van hollen, wouldn't that be almost a total failure by democrats who control the senate, who control the white house to do anything serious about our debt when we've got a $14.3 trillion debt? >> i'm not a fan of the mitch mcconnell deal. we agree on that.
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it does punt it. what it does is it says we the congress will not take responsibility or accountability for our own decisions. it's a political answer. not a real answer to the problem. now, whether we're driven in that direction by events, i don't know. but we also want a big deal. the president did put a grand proposal on the table. we know that -- >> chris: we'll get to that in a second. if it's a choice, because the clock is ticking. 16 days. if it's a choice between the mcconnell plan or nothing, not raising the debt ceiling on august 2, are you going to vote for the mcconnell plan? >> i am working very hard so that is not our only choice. i will say this. we cannot default on our debt. americans can't choose not to pay the bills they incurred. we know what a catastrophe that would be. i know there have been bills introduced in the house that suggest that you can sort of skate by this. standard & poor's, moody's, chamber of commerce, they all say that's just not so. >> chris: we're going to go into the whole question of default and what it would mean in a moment. congressman jordan, though,
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stay on the mcconnell plan for a moment. if it comes down to that, you are already shaking your head. if it comes down to mcconnell plan or going past august 2 without raising the debt limit, how will you vote? >> mcconnell plan doesn't have 18 republican votes. no way, there are all kind of conservative in the republican study committee that will not support the plan. as chris pointed out, it's a path -- >> chris: you're saying that the mcconnell plan will not pass the house? >> who knows if there is a combination of "r"s and "d" lazy go for it. but house conservative members won't support the mcconnell plan. i am not going to support the mcconnell plan. as chris points out, this is kicking the can down the road. the american people sent us here to make big tough choices. they didn't send us here to set up a commission. that's not what they sent us here to do. put plans on the table like we did. the only plan out there is the cut, cap and balance plan. let the american people look at it over the next two weeks and let's have a real debate.
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this is so important for the future of this country. we are headed for a cliff. if we don't fix it, now it's, we are in big trouble. have a national debate. >> the question of the grand bar gan, because president obama continues to say that he wants a big deal over $4 trillion in spending cuts. and tax revenue increases. congressman van hollen, part of the problem is, this is something that congressman jordan said several times now is that he is not specific. not specific. especially on spending cuts. especially on entitlements. let me put up something that the head of the nonpartisan congressional budget said. he was asked how much the president's latest plan would cut the deficit. he said we don't estimate speeches. we need much more specificity than provided in that speech for to us do our analysis. i mean, the fact is that the president talked in great detail about what he wants in revenue increases. but he is not specific at all when it comes to what he will
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take in spending cuts. >> the president has put a framework proposal on. he has been in discussion with speaker boehner. there is the white house hammering out a lot of the details. the president has said that the framework that he wants to approach not every detail, but the framework is the simpson-bowles, the bipartisan plan. the reason the discussions could not continue was because republican colleagues refused to agree to close even one corporate tax loophole. they refuse to talk about the folks at the high end. simply going back to the rates that were in place in the clinton administration. that is a stumbling block. that is a conversation ender. if you are not willing to talk about ending subsidiaries for oil and gas companies for purpose of deficit reduction, where do you go? >> chris: let me ask about this. you can give whatever answer you want. you were reportedly one of the key players that forced speaker boehner to walk about talks about a grand bargain. i understand that there is a problem, a legitimate issue
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with fuzzy numbers coming out of the white house. but assuming that you could solve that problem, you're unwilling to accept $3 in spending cut for every $1 in revenue increase? >> a couple of things. think of the president's framework there is no specificity to the proposal. he is saying tall spending that the democrats did in the last congress, stimulus, obamacare, all the budget, the spending in the last congress that we voted against and the american people didn't like as evidenced by last november's election. the president is now asking hey, republicans, vote for a debt ceiling increase, even though you campaigned against it and the voters elect you to be against it. vote for debt limit increase to pay for the spending. to add insult to injury, support tax increases while you're at it. that is what he says no specificity to any plan. ridiculous. >> chris: if i may, assuming there were specificity, would you not accept a formula of $3 in spending cuts? this is a liberal democratic president talking about the $3 in spending cuts, including
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entitlement for $1 in revenue. >> first, all the spending cut takes place in the outyears. he never gives us detail on what will happen in the first year. that is the only year that counts. it's the only year we make law about. so the tax increases will come soon. the american people, this is the old, the old cliche, this is lucy and charlie brown with the football. the american people say we are not falling for that game anymore. we are not going to let you promise spending cuts later to raise taxes now. if the tax things were so bad that chris talks about, the democrats just controlled the government eight months ago. why in the world didn't they get rid of them? they had the house, the senate. super majority in the senate until scott brown got elected. if they are so bad, they're hurting our economy and keeping us from getting to a deal, why -- >> chris: that is a good question. i'm going to let congressman van hollen answer it. but i want to ask a question first before i do. the polls show only 20 to 25% of americans want a deal that is only spending cuts. >> they also show they don't want tax increases. here is what we all know, all
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three of us. if you raise taxes on the small business owners that make the economy go, raise it now with 9% unemployment, you are making it that much more difficult for our economy to grow and for jobs to be created. everyone understands that fundamental point. they also understand the basics. government spends too much. it's not a revenue problem. it's a spending problem. everyone gets that basic point. >> chris: congressman van hollen? >> we all know that c.b.o., nonpartisan entity said that the number one driver, policy decision driving the need to raise the debt ceiling now and big contributor to the problem were the tax cuts 2001, 2003. the disproportion nately hit the top. >> chris: wait, wait, wait. i just read -- i just read yesterday. if i may. i just read yesterday that barack obama increased our debt 35% in the last 2-1/2 years. >> $3.8 trillion in the last two-and-a-half years. >> number one policy decision. the biggest driver of the debt is the economy going down. that is obviously a decision -- that is not a
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policy decision. >> chris: $1 trillion for stimulus. >> that is a short-term thing. that was trying to get the economy going. >> chris: it didn't work. >> not a long-term driver of the debt. get the facts straight here. you asked the fundamental question, are they willing to take a bargain? $3 in cuts to $1 in revenue increases. the revenue increases begin in 2013. nothing in the short-term. the president talked apt a payroll tax holiday. number two, we're talking about closing a lot of corporate loopholes and number three, we said go back to the same rates that were in place in the clinton administration which was a time when the economy was booming 12 million jobs added. because they won't talk about that framework, 3-to-1, the conversation ends. >> chris: what we have seen here is the problem, frankly, you are not agreeing that there is no effort to get together on either side, which brings to us the debt deadline. 16 days. congressman jordan, you say that the world isn't going to end on august 2. let me just finish. you say the world isn't going
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to end on august 2, if we can pay our bond holders with the revenue that is coming in and we prioritize rest of the spending. here is the problem. put it on the screen. the bipartisan policy center. a fellow who was a treasury official, jay powell in the george h.w. bush administration did analysis of what the government would have to cut. 44% in other spending. even if you pay social security, medicare benefits, you have to choose among military salary, veteran benefit, unemployment insurance, f.b.i., f.a.a. bill gross, head of pemco, the world's biggest bond company, bond fund, already sold, they have spoke within their wallet, they sold most of treasury securities, he says that the market situation might resemble what happened after lehman brothers collapsed in 2008. this isn't a politician. this is the market talking. >> again, the market is saying that they are saying if we don't do something real to put us on sustainable fiscal path, do something real, they will
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downgrade us whether the debt creeling is passed august 2 or not. that is the most important thing to keep in mind. where we're headed. the big crisis coming is more important than anything right now. if we get past august 2, the president has to lead. he will have to make choices. he is going to have to prioritize. there is enough money in the month of august to make sure we pay the bondholders, we make sure we pay social security and pay troops in the field. after that, the president has to do something he is unwilling to do now. make decisions and lead. >> chris: you're saying that is preferable to passing the mcconnell fallback. >> the preference plan is to cut cap and balance. that is the important -- >> chris: what is preferable, mcconnell plan or august 2? >> the mcconnell plan will make it obvious we're going to the default. >> you're saying if they put this in place. >> what is wrong with letting the state decide to have a balance, 49 out of 50 states have it.
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>> the reality is. >> every municipality. every township government. every city government. every business. every family. >> you have a provision in there to make it easier -- [ overtalk ] >> this is not a real balanced budget amendment. >> chris: wait. gentlemen. >> you know it. [ overtalk ] >> can i say this? you allowed the united states to default on the debt, which family in america could do. it will hurt every family in america. >> chris: response, congressman? >> no one wants that. but balanced budget requirement that everyone else has to deliver -- [over talk ] >> chris: congressman jordan, congressman van hollen, glad we were able to set this and arrive at a deal. thank you, both. thanks for coming in today, gentlemen. we'll see how it plays out over the next 16 days. up next, presidential candidate herman cain. they're shaking hands off-camera. presidential candidate herman cain on his plan for victory and the growing republican
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>> chris: with new fundraising number out in the iowa debate and straw poll, now less than a month away, we continue the "2012: one on one" series with republican presidential candidate herman cain. welcome back to "fox news sunday." >> thank you, chris. i'm glad to exercise my right to return to your show. [ laughter ] >> chris: you planned that. that's very good.
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you say you agree with jim jordan say we don't need to raise the debt ceiling, but the chairman of the financial reserve says it would be a financial calamity. you saw the last segment where bill gross the head of pemco says it could cause another market collapse like the fall of 2008. you talk about listening to the experts. aren't you ignoring them? >> that is one expert. >> chris: i just mentioned two. >> well, that's two i'm listening to many others who are saying that this is a charade. let's back up, chris. this crisis didn't need to happen number one. number two, now that the president has allowed this crisis to evolve, it's, they cannot -- they can hold the debt ceiling where it is, make hard cut like congressman talked about earlier and continue to re-establish confidence in what they are doing. it's all political prosturing. they don't need to raise the
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debt ceiling. congressman talked about pay the things that are necessary. pay the interest on the debt. take care of the military families. social security checks. that will work. but what the president and the democrats don't want to do is toing may cuts on whatever is left. >> chris: let's talk about whatever is left. i mentioned this with the two congressmen. bipartisan policy center, this was an analysis done by a fellow named jay powell, a top treasury official under bush 41. he did an analysis and it found you can do that, you have the money, and you can pay the monday holders. they won't go into technical default. what is left, you have to cut other government programs by 44%. that is almost half. so, the argument he makes is even if you pay medicare, and medicaid, you have to choose between veterans benefits, or unemployment benefits. military pay, or closing the f.b.i. and the f.a.a. >> not necessarily. those are scare tactics, chris.
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what about money that we spend on nonessentials? >> chris: there isn't 44% of that. >> chris, not if you are going to try to do it straight down. you have to take program by program and find that money. some agencies, you might need to cut 60%. some agencies you might need to cut 30%. to say 40% across the board, no, that is not how you get there. you get there by taking agency by agency by agency and look for the cuts. some of them will be bigger than 40%. >> chris: since we last talked you have put out an economic plan. >> yes. >> chris: that you say will put america back to work. based primarily, there are things like cutting regulations but based primarily on lowering taxes. >> yes. >> let's put it up. you would lower the top individual and corporate tax rates to 25%. you would have no taxes on capital gains. let me just ask about this. you talk about doing something about the debt. eliminating capital gains taxes, would add -- add --
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$1 trillion to our deficit over the next decade. that is how much we take in, in captain gains. >> that is analysis, chris, that is where the $1 trillion comes from. if you do dynamic analysis, it does not add $1 trillion. the capital gains tax is a wall between people with money and people with ideas. ideas create new businesses. new businesses create jobs. small businesses produce most of them. let me make one other point about this. the engine to our economic growth is the business sector. this administration has put nothing in the engine and everything in the caboose. we are never going to grow until we lower those tax rates. remove that captain gains value and suspend taxes on repatriateed profit. this is why this economy is stuck in stall. >> chris: let me ask about another aspect. warren buffett likes to say he pays a lower tax rate than his secretary, because he pays the
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vast majority of his money is in capital gains so he pays 15%. so his secretary pays at an income tax rate. what about the issue of tax fairness? the people who are going to benefit primarily if you reduce the capital gain tax rate to zero are wealthy people. >> nope, it's small businesses. remember small business people are organized subchapter "s" corporations. there are more of them than warren buffetts. i don't care about warren buffett's tax rate and the american people don't care about warren buffett's tax rate. i care about tax rate of the small businesses that if they eke out a profit in the business, it goes through that personal income. if they invest it and get gain on the capital, they will be double taxed. that is the group that is primarily affected. this thing about the warren buffett tax rate is just playing the class warfare card. this thing about people flying around in corporate jets is class warfare. i am concerned about the $15 million people who do not
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have a job and they are not going to get jobs with more government spending. they are only going to get jobs when the business sector, the engine starts to grow again. you've got to add certainty to what is going to happen in the future before businessmen and business women start to grow the economy. >> chris: you said this week that you oppose construction of a new mosque in murphy's borough, tennessee, close to nashville. >> yes. >> chris: they have operated, muslim worshipers and another site there for more than 20 years. what is your objection for them building a new mossk? >> one of my guiding principles is if you want to know the solution to the problem or if you want to understand the problem, go to the source closeest to the problem. i talk to the people in the community. and here is their problem. i sympathize with them. our constitution guarantees separation of church and state. islam combines church and state.
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they are trying to infuse their position income the community and people in the community don't like it, they disagree with it. shariah law is what they are trying to infuse in to our -- >> chris: wait a minute. are you saying we should ban all muslims from worshiping in this country? >> no, i did not say that. >> chris: no, i'm asking. >> i'm not saying that. what i am saying is american laws in american courts. that is what the people are saying. that's what people are saying all -- >> chris: but the mosque isn't going to. >> well, chris, i happen to also know it's not just about a religious mosque. there are other things going on based on talking to people close to the problem. this is not just a mosque for religious purposes. this is what they are objecting to. >> chris: they held rallies in 2009 and last year to support the palestinians and including hamas in gaza. this is going to a county judge who says that there may be a question about the open
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meetings rule. but he said that the people brought suit to try to stop this haven't been heard and they have a right to build a mosque. my question, this isn't ground zero in new york city. this is in the hallowed ground. don't americans have a right of whatever religion, under the constitution, which you speak so much about to free speech and freedom to worship? >> to the people, it is hallowed ground. they are objecting to the intentions of trying to get shariah law. that judge may have ruled but this case isn't over with yet. i believe it will go to the supreme court. it's not hallowed ground. it's hallowed ground for people there. >> chris: couldn't any community then say we don't want a mosque in our community? >> they could say that. chris, let's go back to the fundamental issue that the people are saying that they are objecting to. they are objecting to the fact that islam is both a religion
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and set of laws, shariah law. that is the difference between any one of our other traditional religions where it's just about religious purposes. the people in the community know best. i happen to side with the people in the community. >> chris: you are saying any community if they want to ban a mosque. >> yes, they have the right to do that. that is not discriminating based on religion against the particular religion there is an aspect of them building the mosque that doesn't get talked about. people in the community know what is it and they are talking about it. >> chris: all right. i don't want to beat a dead horse but i'll ask one more question about this and we'll move on. this gets back to an early controversy where as you know you said that you are not comfortable with the idea of appointing a muslim to your cabinet. as someone i'm sure who faced prejudice growing up in the '50s and '60s, how do you respond to those who say you are doing the same thing? >> i tell them that is absolutely not true.
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it's absolutely totally different. i grew up like you said in the '50s and the '60s. i grew up before the civil rights music, during the civil rights movement and after the civil rights movement. i went to corporate america when openness to putting blacks and minorities and corporations and i moved up the corporate ladder. we had some laws that were restricting people because of their color and because of their color only. that is what that situation was. >> chris: aren't you willing to restrict people because of their religion? >> i am willing to take a harder look at people that might be terrorists. that's what i'm saying. i know that there is a peaceful group of muslims in this country. god bless them and they are tree to worship. i no problem with that. if you look at my career, i never discriminated against anybody. because of their religion, sex, origin or anything like that. i am saying i owe it to the american people to be cautious because terrorists are trying to kill us. i'll err on the side of caution, rather than carelessness. >> chris: 2012, in the last month, forgive me for saying
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this, it seems that michele bachmann has taken much of your support among the tea partyers and among social conservatives. put up the latest poll of iowa caucus goers. she leads the field with 32%. you are back at 1% in this poll. has she eclipsed you? why should they pick you over bachmann? what is the choice between you and bachmann? >> it's simple. my career has been problem-solving, not politics. the poll may not reflect it but the numbers from the first report reflect a little different story. if you look at the latest gallup poll with positive intensity, i lead all candidates in terms of the positive intensity. secondly, in the last six weeks my name i.d. has gone from 21% to 48%. >> chris: versus bachmann, are you different on the issues? >> we're close on the issues.
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we're different that i more direct hands-on problem-solving experience. that is where we differ. issue wise, we're very close. i said it before. the difference is my entire career as a problem-solvers, business invader burger king, godfather, national restaurant association, the problem-solving approach is where i have stronger credentials that literally many of the other candidates. >> chris: let me ask you a question. we get to the bottom line and given your experience. four years ago, sam brownback, the senator from kansas finished third in the ames straw poll. he felt in his campaigning he had to drop out finishing third. don't you have to finish that well in iowa? >> i believe we will finish in the top three. >> if you don't, would you drop out? >> no, not going to drop out. here is why. the nomination process doesn't stop with the early caucuses only. there are other states on the back end of the process to
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swing it. so, no, that is not necessarily a determining factor. the biggest determining factor whether i stay in or drop out won't be whether i finish first, second, third, fourth, but the number of supporters that we're getting. what we are hearing from the people who are actually out there in the states. >> chris: we have run out of time. i want to plug the fact that you have a new album -- >> it's been out since 1996. >> chris: but it's been reissued and it's called "sunday morning." we're not going to have time to play it. but i tell you, we have been listening to it on the "fox news sunday" set. it's wonderful. what more appropriate sunday morning. there is even a song called "sunday morning." >> exactly. >> chris: mr. cain, thank you for coming in today. pleasure to talk to you. >> thank you. >> chris: safe travels on the campaign trail and we'll see you for the big iowa debate. >> i'll be there. >> chris: good. coming up, the sunday panel on the debt ceiling crisis and whether next week will bring a brand bargain, cut, cap and balance or a fall-back plan. back with the panel in a
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the problem is member of congress are dug in ideologically in various positions because they box themselveses in with previous statements. >> we asked the president to lead, we asked him to put forward a plan. not a speech, a real plan.
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he hasn't but we will. >> chris: president obama and speaker of the house john boehner continuing to point fingers over who is to blame for the current debt ceiling stalemate. time now for the sunday group. bill kristol of "the weekly standard." john podesta head of the center for american progress. liz cheney from keep america safe. fox news political analyst, juan williams. bill, house and senate republicans separately are going to push for vote this week realityed to balanced budget amendment. i understand that it appeals to their base and jim jordan makes an impassioned argument why it's the right policy. but shouldn't they have been doing this months' ago rather than wait for the final two weeks? >> i think it would have been better if the house republicans push "cut, cap and balance" a month ago. they were hesitant. they didn't want to vote for any debt ceiling increase. i'm sympathetic to their dislike of giving the federal government yet more money and ton more money to heap on us more debt. it has to be increased no one has a proposal to cut
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$1.4 trillion right away, which is what you have to do. it's important on tuesday they will pass a dealt ceiling increase with spending cuts and spending caps and a balanced budget amendment added to it. it can no longer be said that house republicans have their heads in the sands. they are not dealing with the debt -- they pass the debt ceiling increase. incumbent on democrats and president obama to say what version of a debt ceiling increase are you for? are you against the spending cuts? against spending caps? against the balanced budget amendment? >> chris: well, that gets us to the big republican argument about the democrats and especially this president, which is that he keeps talking about a big deal. he talks about specificity of revenue increase, he is fuzzy with spending cuts, especially entitlement cults. why? >> look, he has put a framework on the table, as chris van hollen said. it includes restraint in discretionary spending on both domestic and the defense side. he has put forward $100 billion worth of cuts in
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cut and healthcare program he put forward. i don't think he has -- i think he has gone further in discussions with speaker boehner. i don't think he has been nonspecific in the areas. >> chris: he was at -- let me ask the question. he was asked at the news conference what entitlement reform would you make? he mentioned only one, mean testing for medicare. >> right. he has pacific cut in the budget with respect to both medicaid and medicare, which are more -- remember, republicans ran against the cut in medicare and flipped over and said now wave to privatize the system and go to voucher system and take $1.4 trillion out of medicaid. he has been specific there is negotiation. now we're just running the
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clock and wasting our time. it's tragic. >> chris: liz? >> the president's 2012 budget includes over $7 trillion added to the national debt. the republican budget passed by the house cut spending by $6 trillion. you have a president who won't put a plan on the table. he wants to demagogue. you have seen the republicans saying look, we have to have the spending cuts here. i am watching the debate from wyoming and this looks like politicians that want to kick the can down the road. off group of republicans in the house like jim jordan who are saying no. we have a freight train of debt that is hurdling down the tracks toward us. the only responsible thing is get spending under control. >> chris: you've got divided government. tough democrats controlling the white house andnate. republicans controlling the house.
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in any negotiation, they have to give. >> we have to raise the debt ceiling. we have can't raise the debt ceiling. we have to leave it where is it. but they have to understand that people are not willing to vote for increase without change in terms of the spending. >> chris: i'm sorry, i'll get to you in a second. let's assume -- i understand the arguement that the cuts that the president talks about are fuzzy. if you could get $3 in spending cuts for $1234 revenue increases, would you make that deal? >> if i was voting, absolutely not. revenue increases, the tax increase which the president wants and tax increases are job killers and lead to slowing the sluggish economic growth. the president himself acknowledged in 2009 you do not raise taxes in the middle of an economic downturn, the wrong thing to do. >> chris: taxes wouldn't kick in until 2013.
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>> but you know that businesses out there looking ahead will know there will be massive increase in taxes because of obamacare. new regulation, now new tax increases in 2013. they are not going to hire or invest. we have to cut spending. taxes are not the issue. republicans are right to say absolutely not, mr. president. we want $1 for spending cuts for every $1 of increase. >> i'm glad to hear liz say this. of course she thinks that the debt ceiling those be raised. that is rational because i'm amazed at the number of republicans who think it's arbitrary deadline to treasury secretary despite what we hear from standard & poor's and what we heard from moody's and from the federal chairman ben bernanke. the second part, with tax hikes if this was about taxes we'd see the interest rates high in this country. interest rates are at a historic low. it's not the problem. for $3 in cuts which is what the republicans said they want, someone is saying you know what? let's have the super rich chair responsibility for the
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deficit and republicans say no. this lacks an element which is key. enough with the political posturing. bill kristol says now republicans have a package on the floor tuesday when they have a vote in the house. the vote is symbolic and empty, it rattles around like empty -- >> chris: okay, look, we have heard all of the arguments. this is 16 days and counting. where do you get a deal? >> you don't get a deal i don't think. the closed door negotiations and let people put the cards on the table. not have a horrible, you know, poker game going on with everyone, liars poker and all that stuff. let's have a serious -- the house of representatives is going to pass legislation tuesday. that is different from speeches or closed door negotiations. >> chris: where does it get us if it won't pass the senate? >> how do we know it won't pass the senate? let's have majority bring it up. >> chris: are you suggesting it will pass the senate?
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>> let them offer legislation. here is the president of the united states and he has no proposal there is no proposal on floor right now by the democratic majority of the senate and the president of the united states to deal with the problem. the house republicans to their credit, they should have done at it month ago but to their credit they are going to pass legislation to raise the debt ceiling and cut spending. >> chris: i have to break in here. we'll continue the conversation. when we come back, in addition to talking about this, we will focus on the political impact as the debate over the debt ceiling may have on the 2012 presidential race. we'll be right back. there 24/7. a real person will be there to help you. then you can use to view photos of the damage, track your claim, print an estimate. you want an english muffin? they literally hand you a toasted muffin with butter and jam. (sigh) whaa. tasty. that's, that's a complete dramatization of course, but you get my point. vo: geico 15 minutes could save you 15% or more on car insurance.
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whoever the republican nominee is, you know, we're going to have a big serious debate about what we believe is the right way to guide america forward and win the
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tuture. i am confident that i will win that debate. >> president obama acknowledging the debate over the country's debt and the size and scope of government will be one of the big issues in the presidential race next year. back with the panel. white house officials do seem genuinely confident like the president said they are winning the argument politically. the president comes off as he wants a big deal and wants a balance. that's what most people want between spending cuts and at least come revenue increase. bill, are they right to feel -- forget the substance, are they right to feel good about their position? >> if you look at the polls, the president's approval rating is just as down over the last three or four weeks in the higher gallup, higher disapproval than approval in match up against generic
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candidate he loses. 7 was the biggest margin i think in the gallup where he was losing. inside the beltway, everybody thinks obama is out-maneuvering republicans. republicans made mistakes but the longer we have a debate about debt and deficit and the magnitude of the spending and failure of the stimulus and failure of the big spending programs, it hurts the president. i don't think the president should shy away for the debate. >> not one republican running beats president obama head-to-head. the business about generic that is like harry potter running against luke skywalker there is no reality to it. >> chris: that would be a hard choice. >> yes. >> against both of them. >> if you look at the numbers right now, it's overwhelming. the president said even republicans would go for some kind of tax hikes on the super rich in order to gate deal. and avoid the calamity. >> chris: the president came in office and he was elected
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to fix the economy, which we all agree he hasn't done. we were told he would end the partisan ranker and get the town to work. if they can't get a deal and as it goes on, doesn't it hurt him? one of the reason that people voted for him, he would fix the system. >> there is no evidence he is working toward a deal. he is willing to compromise and he is willing to say, as you point out, there is too much spending in the town, let's have substantial cuts. eric cantor said in terms of the biden negotiation, $2 trillion on the table. but cantor didn't say we have something to go with it. >> this president is out of step with history and where most american people are. he doesn't believe that the private sector creates job. i will give you three example of where he stands in the press conference this week. neither press conference, at any time did he say the words "private sector." he believes the solution is we'll have more government growth, the government hire
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people. secondly, at one point in the second press conference or the first press conference he said that really, he doesn't think he ought to be able to keep more than he needs from the government. now this notion that the government somehow decides what the american people need and ought to keep is not any kind of a recipe for economic health. it certainly isn't capitalism. finally, the president at the end of the press conference says he wants to increase taxes and get through this initial crisis so that he can spend more on infrastructure. this is an insatiable appetite for spending. completely irresponsible. >> i think that is so fundamentally wrong on the facts. president obama proposed taking the domestic government down to the size that it was in the eisenhower administration. that is in his budget. we have taxes now lower than they have ever been since 1950. and have -- >> chris: a lot of that is because we're in a recession.
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>> recession but the bush tax cuts contribute substantially to that. particularly for the high end. whether the republican -- what are the republicans proposing? go further than that. now we're in a hostage-taking situation on the debt limit that will be catastrophic if we actually do go over that august 2 deadline. i actually think this is the craziest hostage-taking that we've seen since al pacino were in "dog day afternoon." >> chris: very good reference. that is the second movie reference. >> we like movies around here. but they have to come to grips with the fact that it would be catastrophic, ronald reagan said in 1983. s&p, and moody's said and bernanke perp have said. if we don't raise the debt limit by august 2 and those 44% in cuts take place, it will do nothing but drive the economy in to a second recession. now, that may be the simple
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attitude of the house republican leadership. maybe that's what they want, which is to damage obama by damaging the economy. but i think that the american people see what the president said. >> this president added more to the debt than all previous presidents combined. all you've got to do is find -- [ overtalk ] all you've got to do, all you've -- >> chris: wait, wait. >> let me finish. >> chris: let her finish. juan, juan, stop it. go ahead. >> the main stimulus program did nothing to help that. 9.2% unemployment. you could easily find $1.4 trillion in savings if you would appeal obamacare. not complicated. this president refuses to put obama care on the table. >> every, every, independent analysis. >> wait. >> the bush tax cut, medicare part "d" and two wars. >> bush tax cuts.
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>> it contributes 15%. >> you keep talking about the bush tax cuts for super rich. >> chris: wait, wait. wait. okay. everybody calm? let's -- what is going to happen? i mean, all you are doing is repeating the argument we heard and heard and heard. every one of you agrees that we cannot get past august 2 without raising the debt ceiling. agree? yes? >> yes. >> should not. >> chris: so what is going to happen? >> the republicans will pass "cut, cap and balance" and pass prioritizing of federal expenditures if there is a few weeks where the debt ceiling goes past august 2, so social security, medicare, defense is taken care of. they will also pass, i believe, a short-term increase, for maybe a month. $100 billion -- you'll explain it to the american public. $100 billion in debt ceiling and spending cuts and the president endorses it. he's there, why? because it doesn't purport with his vision of what should
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happen? >> i don't like it but it's a version of mcconnell, which is cut the deficit now by $1.3, $1.4 trillion. get this passed, get the debt limit past the election and fight it out next year in the election. president obama will frame it and the republicans can answer. >> chris: you have 30 seconds. what is going to happen? >> the president will lose the election in 2012. >> chris: i'm talking about. >> i think the republicans in the house will in fact pass spending cuts along with the debt limit increase and i think it will then go to'and be up to him as bill said to explain to the american people he is demanding we act -- >> chris: juan, 15 seconds. >> outrage from wall street will become so intense republicans will have to say yes to something. >> chris: thank you, panel. see you next week. thank you for staying inside the clock. don't forget to check out panel plus. you are really going to watch today because without any time limits the group will pick up with the discussion on the website. we will post the video before
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noon eastern time. up next, we hear from you. ♪ [ male announcer ] how could switchgrass in argentina, change engineering in dubai, aluminum production in south africa, and the aerospace industry in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing.
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>> chris: time now for comments you posted to the blog wallace watch with the august 2 debt deadline fast approaching, many of you had questions about what happens next, like we did. bret nichols writes -- "if congress and the president did not have a deal by august 2, will the salaries and benefits of all washington leaders and staff also be suspended along with other payments ?"
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murial from las vegas asks "how much of the debt ceiling, if any, would be affected by the repeal of the healthcare law known as obamacare?" ann heally sent this. "why cut social security from those of us elderly women who only have social security as the income? let's cut foreign aid from countries that do not support us. where is the common sense?" please keep your comments coming to us at that is it for today. we have want to wish the u.s. women's soccer team all the best in today's world cup final. have a great week. we'll see you next "fox news sunday." captioned by closed captioning services, inc
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